Multiple choice

The simple interest on a sum of money at 8% p.a. for 2 years is Rs. 1,300. What is the compound interest on the same sum for the same time period at the same rate?

  1. Rs. 2,719

  2. Rs. 2,810

  3. Rs. 2,804

  4. Rs. 1,352

  5. Rs. 2,700
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

SI = P * R * T / 100 = 1300. P * 0.08 * 2 = 1300. P = 1300 / 0.16 = 8125. CI = P * ((1 + R/100)^T - 1) = 8125 * ((1.08)^2 - 1) = 8125 * (1.1664 - 1) = 8125 * 0.1664 = 1352.

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